PUMP is an eye-opening documentary that tells the story of America’s addiction to oil, from its corporate conspiracy beginnings to its current monopoly today, and explains clearly and simply how we can end it and finally win choice at the pump. This film is well researched and easy to understand. The directors, Joshua and Rebecca Tickell won a Sundance award for their 2008 documentary Fuel.
Read more at: Working Mother
America’s obsession with oil is on tap in Pump, the latest film by husband-wife documentarian duo Joshua Tickell and Rebecca Harrell Tickell. Their previous film, Fuel, Freedom and The Big Fix, also focused on the hazards of America’s oil dependence, so it’s no surprise that Pump – which premiered in the D.C. area Oct. 6 – tackles the issue head on, with the goal of advocating for alternative fuel solutions.
Read more at: Washington Jewish Week
It was only in July 2013 that AAA’s Chris Plaushin told a Senate committee: “The days of a national pump price below $3 is probably a thing of the past.”
Well, an unforeseen drop in the price of crude oil the past few months has sent the price of refined gasoline down so fast that the average price per gallon could soon fall below that $3 threshold, Gregg Laskoski, senior petroleum analyst at GasBuddy.com, told The Christian Science Monitor.
“It’s conceivable that the national average could get down to $2.95. … Exactly when would that occur? That’s tougher to guess. It could be before Thanksgiving.”
At least one observer wonders whether it’s time to start protecting up the burgeoning U.S. oil industry. Chip Register, managing director of Sapient Global Markets, writes in Forbes:
“One possibility would be for the government to level the playing field with OPEC and others by introducing tariffs on cheap foreign oil imports, with the goal of driving separation between the North American energy economy and the chaos of the international markets. While this may seem extreme, it may be necessary to protect this young yet highly strategic industry from going extinct.”
The global price of oil is off about 25 percent since June, and it’s already having an impact on U.S. drilling operations. As Real Clear Energy’s Nick Cunningham noted in a post Wednesday, there are now 1,590 active oil rigs in the country, the lowest level in six weeks.
Drilling in shale-oil formations, largely using hydraulic fracturing, helped the U.S. reach 8.95 million barrels of oil per day this month, the highest level in 29 years. But as a story in Bloomberg points out, that growth trajectory is difficult to maintain:
“Oil production from shale drilling, which bores horizontally through hard rock, declines more than 80 percent in four years, more than three times faster than conventional, vertical wells, according to the IEA [International Energy Agency].”
Shale-oil production is relatively expensive compared with imported oil, so it won’t take much of a drop in global prices to make some domestic operations unprofitable. The Bloomberg story quotes Philip Verleger (an economic adviser to President Ford and director of energy policy for President Carter), who says that if oil falls to $70 a barrel, production in the Bakken shale formation could plummet 28 percent to 800,000 barrels a day; in July the production level was 1.1 million barrels a day.
The notion Register raised isn’t new: In early October, Ed Hirs, a lecturer in energy economics at the University of Houston, touted a paper he’d written suggesting that the U.S. government intervene to restrict oil imports and protect U.S. producers.
“We need to act in our own best interest,” Hirs said at an energy symposium, according to Forbes. America’s oil growth is so strong “that we can de-link from the global market.”
The U.S. Circuit Court of Appeals for the District of Columbia has again ruled that outside groups don’t have legal standing to file a lawsuit against the EPA’s waiver allowing E15 into the marketplace.
E15 — a blend of up to 15 percent ethanol — was allowed by the EPA waiver four years ago, for all vehicles made in model year 2001 or newer.
The waiver had been challenged by the American Petroleum Institute and the Engine Products Group.
The court had previously ruled against a similar lawsuit filed by the Grocery Manufacturers Association, deciding the group also didn’t have standing.
Read more in Domestic Fuel magazine.
Islamic State, or ISIS, is the world’s most well-financed terrorist network, owing to at least $1 million a day in illicit oil revenues. But David S. Cohen, under secretary for terrorism and financial intelligence at the U.S. Treasury Department, expects to make a dent in ISIS’ finances “long before 36 months,” referring to the timeline President Obama laid out last month for the U.S.-led military campaign designed to “degrade and destroy” the group.
Read more in The New York Times.
The New York Times editorial board has a reasonable take on the falling price of oil, enumerating several winners and losers.
Low prices, obviously, are good for consumers. But they’re bad for countries that don’t have diverse economies, and for people promoting alternative forms of transportation fuel.
“It’s bad for the environment because cheaper oil means fewer incentives to develop alternative and less carbon-intensive sources of energy,” the editorial states.
“… it is imperative that the United States and all other beneficiaries resist the temptation to use what could be a fleeting drop in prices to slow the search for alternative sources of energy. The planet, alas, does not have the resilience of oil prices.”
USA Today just reported that Ford is cutting the sticker price of the fully battery-powered plug-in Focus Electric by a flat $6,000. That’s on top of a $4,000 price reduction on the same vehicle a year ago. The new sticker price is $29,995 including shipping—but not including federal tax credits of up to $7,500 and state incentives that might effectively knock another $2,500 off the amount buyers pay.
Read more in TIME.
Calgary-based Canadian Pacific Railway Ltd., has dropped merger talks with CSX Corp. of Jacksonville, Fla., and remarks this week by the always-blunt Canadian Pacific CEO E. Hunter Harrison are very telling about the future of oil traveling by rail.
The volume of oil, including that produced in the Bakken shale formation in North Dakota and southern Canada, is soaring, and yet many communities are concerned about the increased rail traffic to carry the oil to refineries. In 2013 a derailment and resulting inferno in Quebec killed 47 people, and since then the issue has been on the minds of activists, local politicians and the U.S. government, which is considering stronger tank-car hulls and other safety improvements.
Harrison said mergers are needed to prevent gridlock in the North American rail system.
“There’s a desire to put more tonnage on the rail,” Harrison said during a conference call Tuesday, according to Toronto’s Globe and Mail. At the same time, governments are saying that we want to slow you down because of [hazardous materials] and crude. There’s no more infrastructure [being built]. No one wants the railroad to run through their backyard, or their city.”
E&E Publishing’s Blake Sobczak has much more from Harrison on that subject. Here are quotes from Harrison in a story Wednesday on E&E’s Energy Wire page (subscription required):
“We even have issues on our network now where there’s city councils and groups of citizens banded together who say, ‘We don’t want you to run trains at night.’ … In my view, at least, we are quickly approaching a time where none of this works.”
In New York state, a coalition of environmental groups led by Earthjustice filed a petition with the state urging a ban on allowing older DOT-111 tank cars going through the Port of Albany. Charlene Benton, president of the Ezra Prentice Homes Tenants Association, said in an Earthjustice statement that many families live “within a few feet of these bomb trains. Our families deserve to live free of the daily fear that one of these trains will blow up in our backyard. The time to act is now, before it is too late.”
Lane Kelley of ICIS Chemical Business calls it “methanol mania” and he probably wasn’t exaggerating. Last week Texas and Louisiana underwent an explosion of activity, promising to turn the region into a world center for methanol.
Earlier this month, Louisiana Gov. Bobby Jindal announced that Castleton Commodities International LLC (CCI), a Connecticut firm, will be building a $1.2 billion methanol manufacturing plant on the Mississippi River in Plaquemines Parish. The plant is expected to produce $1.8 million tons of methanol a year.
“This plant will help our children stay in Louisiana instead of leaving the state to find jobs,” said Jindal. “My number one priority it to make Louisiana a business friendly place.”
But that’s not even half of it. The Environmental Protection Administration (EPA) just gave its final approval to a $1 billion methanol plant to be built near Beaumont, Texas. The facility will be operated by Natgasoline LLC, a subsidiary of a Netherlands-based company that already employs 72,000 people in 35 countries. It will employ thousands of construction workers and carry a $20 million payroll when it begins operating in of 2016.
Does that sound like a lot? Well, don’t forget Methanex Corporation, the country’s largest manufacturer of methanol, is in the process of moving two plants back from Chile to Louisiana. One plant is scheduled to open in a few months. And ZEEP (Zero Emissions Energy Plants), an Austin-based company, has just raised $1 million for a proposed plant in St. James Parish, La.
Does that sound like a full plate? Well, it’s still just the beginning. The Connell Group, a government-supported operation, announced long-range plans for what would be the largest methanol plant in the world — even if only half it gets built. The first unit, located in either Texas or Louisiana, would produce 3.6 million tons a year, twice the current world record holder in Trinidad. Together, the two units would produce more than the current U.S. demand, 6.3 million tons a year. The term “Gigafactory” soon may be standard vocabulary.
So what’s going on? Well, the plan is for nearly all this Texas and Louisiana methanol production to be exported to China. The widening of the Panama Canal for supertankers, scheduled to be completed in early 2016, will be a bit part of the puzzle. Believe it or not, China also has plans to build three more plants in Oregon and Washington. But they run into trouble there, of the West Coast’s dislike of fossil fuels.
So China is planning to use American natural gas as a substitute for its own coal, in producing large amounts of methanol. It’s no different from the Chinese buying up farmland in Brazil and Ukraine in order to grow crops.
But the Chinese have other things in mind as well. Zhejiang Geely Holding Group Co., Ltd, Chery International, Shanghai Maple Guorun Automobile Co., Ltd. and Shanghai Automotive Industry Corp. all produce methanol-adaptive cars, which now accounts for eight percent of China’s fuel consumption. Israel is also experimenting with methanol from natural gas as a substitute for imported oil.
Methanol produces only 50 percent of the energy of gasoline, but its higher octane rating brings it up into the 65 percent range. It produces 40 percent less carbon dioxide and other pollutants and would go a long way toward helping China improve its pollution problems. As far as methanol production is concerned, China sees only see an upside.
So what’s going on in this country? Well, so far we have the world’s largest reserves of natural gas, we are on the verge of becoming a world center methanol manufacturer — yet we still have a set of rules and regulations and sheer inertia that prevent us from powering our cars with methanol. For some strange reason, the United States is about to become a world center for the production of methanol, yet we still haven’t figured out how to put it to one of its best uses.
Sounds like an opportunity for somebody.
